The global shift of SWIFT MT messages towards the ISO 20022 MX message standard is not only just a replacement for SWIFT MT message types; it is a strategic new system for financial communications between banks and other institutions within the sector.

Research conducted has discovered over 70-80% of global payments are expected to be processed through ISO 20022 MX by the end of the year 2025, making its adoption change entirely how financial institutions operate.

Despite how impactful this is going to be, the SWIFT-MT message is still going to remain as one of the world’s most used message types by financial institutions.

FEEL FREE TO CHECK OUT THIS POST WE MADE ABOUT SWIFT MESSAGES AND FORMATS. CLICK HERE TO LEARN MORE.

What Is ISO 20022 MX Message?

The ISO 20022 MX message is the new international messaging standard for financial transactions. Unlike the old SWIFT MT (Message Type) formats, ISO 20022 uses structured, XML-based messages that capture richer and more granular data.

ISO 20022 messaging standard helps create and manage common payment data across the globe, enabling faster processing, easier delivery, and secured networking with improved reconciliation.

Already, what most institutions did not know was that the Single Euro Payment Area (SEPA) had adopted and integrated the ISO 20022 into its system and had been using the message standard for operation for almost two decades now.

Now with SWIFT’s introduction and migration to ISO 20022, which happened back in 2023 for financial institutions within initiating cross-border payments reporting plus (CBPR+).

What is the point of ISO 20022?

With the introduction of the ISO 20022, what is the point or main purpose for its introduction into the finance system?

• Rich data: ISO 20022 reduces ambiguity by permitting structured fields, in contrast to MT messages.
• Regulatory compliance: Additional details on AML, KYC, and sanctions checks can be included.
• Future-proofing: Facilitates integration with analytics and fraud detection solutions powered by AI.

Adopting ISO 20022 gives the financial system a communication structure that is future-proof and allows sophisticated analytics, real-time payments, and enhanced fraud detection.

With the introduction of the ISO 20022 MX message, better interoperability between banks, regulators, and fintech systems is ensured by its improved data format, facilitating safer, quicker, and more intelligent cross-border transactions globally.

A traditional MT message provides limited payment information, whereas ISO 20022’s pacs.008 can accommodate extended remittance data, beneficiary details, and compliance tags, thereby enhancing the detection of suspicious activity.

Functions of the ISO 20022 MX Message

Here we discuss the functions of the ISO 20022 MX message and what it means for financial institutions, including banks that currently use the previous SWIFT MT message formats.

ISO 20022 MX messages represent the next generation of financial messaging standards, offering richer, structured, and more detailed data compared to the older SWIFT MT messages.

Being XML-based, it gives room to more transparency, accuracy, and efficiency in payments processing and compliance reporting.

So for banks and institutions, adapting and accepting this transition to the new MX Message module means having systems to handle enhanced data fields and ensuring interoperability across global markets.

The change has long-term advantages even if it necessitates personnel training and technological investment. Institutions benefit from enhanced customer satisfaction, regulatory compliance, and risk management.

This change also supports better automation, reducing errors and improving straight-through processing.

Here is why ISO 20022 is being introduced

A consistent language and model for payment data has been created with ISO 20022. Data will become more organized, standardized, and richer with ISO 20022.

Interoperability between market infrastructures, better reconciliation, more effective monitoring, and fast processing are all made possible by this.

How significant is the SWIFT MT and ISO 20022 MX Message Standard Replacement for financial institutions?

A statement from the SWIFT official website stated, “I was keen to understand from BNY Mellon’s Isabel Schmidt about the bank’s stance on the benefits of ISO 20022.

It appears natural that the global payments industry should have the same standard in use end-to-end, and that the standard should be filled with critical information that may go with the payments.

One of the key drivers in moving to ISO 20022 for payments is that it gives participants richer and more structured data than the industry currently has.

The flexible framework allows communities of users, including message development organizations, to define message sets according to the international standard approach.

All migration is internationally agreed by business semantics whenever desirable through the use of ASN.1-based or XML

Why is SWIFT only making the replacement of ISO 20022 MX now, and what are the benefits for cross-border payments?

SWIFT is only now replacing the legacy MT messages with ISO 20022 MX because financial messaging has grown far more complex since MT was first introduced in the 1970s. Back then, simple payment instructions were enough.

Today, cross-border payments require richer data for compliance checks, fraud prevention, sanctions screening, and enhanced transparency. The global push for standardization and digitalization in payments has made the upgrade both timely and necessary.

The fact that ISO 20022 facilitates the transfer of high-quality, rich data between banks is crucial to this. International payments are currently constrained in both space and structure. For instance,

While ISO 20022 allows for four different types of unique references, each of which can include 35 characters, the current MT103 Single Customer Credit Transfer is limited to 16 characters when transferring a sender’s reference.

Allowing this information to pass from end to end, from originator to beneficiary, enables accurate and efficient processing while facilitating new and differentiated services for clients.

What does this mean to us at RATNYXCYBER?

As a secret service tool, these changes and replacements carried out by SWIFT MT do not have any interruptions on how we deliver our payments across borders. Adding to it being an adoption that is also done globally and by top financial institutions.

Since we provide clients different payment services through our GLOCAL access, we have adopted a country-to-country approach, authorizing the shift from MT to MX while still existing within the SWIFT network.

The migration to the ISO 20022 MX message had no changes on us, and there was no disruption from the previous MT103 and MT202 message formats and various others we used.

The migration has helped us sharpen our infrastructure and manage data properly since its adoption, while we are still waiting for the final phase.

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Does the original advanced RATNYXCYBER product run the ISO 20022 MX message?

YES! From Q2 of 2023, after the swift introduction of ISO 20022 the implementation was made in accordance with MT messages used to send and deliver payment.

Introducing the FI To FI credit transfer, replacing the MT102/103 with pacs.008.001.08, and the MT200-205 replaced by pacs.009.001.08 formats.

Advanced users and commercial vendors have full authority over the ISO 20022 MX message format during flash funds wire transfers as well as the MT message format.

How can one order the RATNYXCYBER ISO 20022 MX message in any format?

On how you can order the replaced ISO 20022 MX message format, simply CLICK-HERE or speak with support Talktous@ratnyxcyber.ru